Yamato System Development Co., Ltd.

Providing Various Cloud-Based ICT Solutions 
Yamato System Development Co., Ltd.

Developing Systems to Provide Total Logistics Solutions

Established through the spin-off of Yamato Transport's Computer Division in 1973, Yamato System Development Co., Ltd. (YSD) is responsible for developing and operating the information systems that form the backbone of the Yamato Group's core businesses including TA-Q-BIN and Kuroneko Mail. YSD also actively provides a wide range of ICT services and solutions that improve business efficiency to companies outside the Yamato Group, as more than 60% of the company's sales originate from companies not affiliated with the Yamato Group. Recently, YSD is focusing on cloud-based solutions, which has allowed it to build a comprehensive menu of services that enable clients to visualize the flow of goods, deliver marketing materials nationwide in Japan on demand, and create corporate interoffice mail tracking systems that utilize the same advanced parcel tracking technologies as TA-Q-BIN. 
 (Reporting and editing by Nikkei BP Consulting Inc.)

Focusing on Cloud-Based Systems

Kenji Minaki

Yamato Transport's TA-Q-BIN and Kuroneko Mail services handle more than 1.3 billion and 2.3 billion parcels respectively each year. Yamato System Development Co., Ltd. (YSD) is responsible for developing and operating the parcel tracking as well as invoicing systems that are essential to these services. YSD was established in 1973 with the spin-off of Yamato Transport's Computer Division.

Immediately after its establishment, YSD began to actively develop systems for companies outside the Yamato Group. Today, YSD provides a number of information and communication technology (ICT) services and solutions to a wide range of companies from the manufacturing, distribution and finance sectors, as more than 60% of YSD's sales now originate from companies not affiliated with the Yamato Group.

"Our greatest strengths can be found in the nationwide delivery network of the Yamato Group and our ability to provide customized ICT solutions based on the same systems used to support this network. Not only do we provide system development, we also develop integrated systems that can provide a full range of solutions through to actual logistics and can contract the operations of these systems with responsibility of the Yamato Group," emphasizes YSD President Kenji Minaki.

Minaki goes on to talk about recent trends stating, "Recently our development has centered on cloud-based systems provided over the Internet. Most companies do not necessarily prefer a custom-built system. This is because these companies want to improve business efficiency at the lowest possible cost. Yet, since cloud-based systems can be customized, we can, of course, respond to individual client needs with optimized solutions. A cloud-based system involves nearly no initial investment and offers companies the advantage of handling overhead as a variable expense."

For example, recent cloud-based solutions that are being widely used by a variety of sectors, from manufacturers to trading companies, include "Mieruka" Solutions such as the "Mieruka" Warehouse Management System @ web and "Mieruka" Distribution Process Optimization @ web that can manage nationwide inventories down to a single item.

Although many use inventory management systems, most companies only manage data for individual locations such as manufacturing plants or delivery centers. This means that even if the company is able to optimize its systems for each business location it will not be able to achieve total optimization across the entire company. Using YSD's "Mieruka" Solutions enables a company to visualize and centrally manage the flow of goods from procurement of raw materials through to production and shipment, which will help to reduce inventories.

Because it enables the centralized management of all phases from order receipt to shipment and reduces the lead time for their mail order business, the number of companies implementing the Web Shipment Control Service is on the rise. This system can also provide detailed information on the status of a shipment, which enables a company to promptly address customer inquiries on their shipments. "Even most major corporations with retail stores nationwide in Japan tend to have a specialized distribution center for their mail order business. Since the inventories of their brick-and-mortar stores and distribution center are not managed centrally, these companies are liable to carry extra inventory. Using the Web Shipment Control Service, TA-Q-BIN can be used to deliver items no matter where an order is received in Japan or where the order ships from. This renders the distribution center obsolete, as the company can deliver items directly to the consumer from their nearest retail store. As a result, this reduces inventory and shipment costs," explains Minaki about the advantages of the Web Shipment Control System.

Printing and Delivering Marketing Materials on Demand

Shinkichi Tsutsumi
e-On Demand Solutions Company

YSD's Sales Promotional Items On Demand Service is another cloud-based solution that utilizes Yamato Transport's TA-Q-BIN network. YSD stores marketing materials for consumers such as flyers or catalogues and then uses TA-Q-BIN to deliver these materials directly to a company's nationwide branches or sales offices on demand.

"Many companies have huge quantities of leftover marketing materials at their branches or sales offices. Our Sales Promotional Items On Demand Service can be used to eliminate these leftovers," explains e-On Demand Solutions Company President Shinkichi Tsutsumi about the features of the service.

Among the first to utilize the service, pharmaceutical companies have shown the service to be a solid success.

Major pharmaceutical companies tend to use a sales and marketing strategy where they deploy medical representatives (MR) at their sales offices throughout Japan and then have these MR take marketing materials directly to local medical institutions. A single company can carry upwards of 2,000 types of marketing materials such as catalogues and flyers, with each individual sales office normally in charge of managing these materials. Regardless of actual demand, the head office of the company prints materials based on estimates and ships them nationwide, so often times some of the materials are undistributed and are simply thrown away. Moreover, in most cases pharmaceutical companies are not aware of the extent to which this waste is taking place.

The Sales Promotional Items On Demand Service is a solution that eliminates this waste. Marketing materials are stored in a warehouse operated by YSD, and whenever a MR visits a medical institution, they use the Internet on a computer or mobile device to inform the system of the required number, type as well as delivery address of the marketing materials. Once this information is received, materials are shipped from the warehouse using TA-Q-BIN. Excluding certain regions, marketing materials are generally delivered the next day. These materials can be shipped to the company or directly to the MR's residence or hotel at their business travel destination.

This service also enables a company to reduce the space needed to store these marketing materials at its sales offices to zero. In addition, since these materials are managed at a single location, the company can accurately account for the actual quantity needed for distribution. This means the company can also reduce the number of marketing materials it prints.

"While a system usage fee and delivery fee are required, reducing storage space and the volume of printing will actually reduce the overall cost. In addition, in the case of pharmaceuticals, it would be a major problem if an MR brought a medical institution marketing materials with outdated information. This risk is present when each individual sales office manages marketing materials by themselves, but with the Sales Promotional Items On Demand Service materials are centrally managed, which eliminates any worry," emphasizes On Demand Solutions Group Chief Kosuke Morimoto of the e-On Demand Solutions Company. Recognizing its advantages, several major pharmaceutical companies have already implemented the service.

Starting in 2010, YSD added an on demand printing feature, which has served to boost the service's advantages even more. An advanced on demand printing system was installed at YSD locations in Tokyo and Osaka, thus creating a structure where only the required amount of marketing materials are printed and shipped with each sales office order. As a result, companies using the service can reduce their inventories of marketing materials even further.

Since on demand printing will increase the unit cost, marketing materials that require large quantities can be printed as normal and stored in a warehouse, while materials that require only small quantities can be printed on demand, meaning the service can be tailored to enhance cost and operating efficiencies. "The Sales Promotional Items On Demand Service stands to benefit not only pharmaceutical companies, but also any sector that requires mass quantities of marketing materials to be stored at locations throughout Japan. Many other sectors such as the insurance and automotive sectors are starting to use the service," says Tsutsumi.

Tracking Interoffice Mail Including Important Information

Hiroshi Maki
Secure Trace Company

YSD is developing a number of cloud-based solutions that streamline the business processes of various client companies utilizing TA-Q-BIN's parcel tracking system.

One such solution is the Interoffice Mail Trace Service. "The safeguarding of personal information is a growing need in Japan. Complete mail management is a must when it comes to the personal information of customers, even for interoffice mail services that connect various business locations. If an interoffice mail parcel is lost, a company has to trace its whereabouts to every extent possible until the parcel is found. In this case, the Yamato Group's tracking system will come in quite handy," says Secure Trace Company President Hiroshi Maki.

For example, in many cases credit card companies and insurance companies use interoffice mail to exchange the information of contracted parties between their sales offices, head office, branches and administrative processing center, which are located throughout Japan. When sending interoffice mail in this system, a company will need to record each and every transaction. In addition, there are many cases when companies send this information using high cost registered mail in order to have a proper record of the parcel.

This time-consuming work load as well as associated costs can be significantly reduced using the Interoffice Mail Trace Service. When sending personal information through interoffice mail, the names of the sender and recipient are registered in the system over the Internet and then printed out on a shipping label with a barcode. This barcode is scanned at each place the interoffice mail transits to update the progress of the shipment, which enables users to track it until the final destination. Although interoffice mail is sent using a variety of methods, some financial institutions are known to send it together with cash carried in armored cars.

Some major corporations send upwards of 10,000 parcels a day of interoffice mail that includes important confidential information. YSD provides the specialized envelopes with an imbedded IC tag to ensure that registering such a large volume of mail is not an overly cumbersome process for each business location. These envelopes are fully reusable and information can be immediately read, input and registered into the system simply by placing the envelope atop a specialized reader device.

e-Neko Security Box

The Interoffice Mail Trace Service is used not only by financial institutions. All Nippon Airways (ANA), Japan's second largest airline, implemented the service in March 2009 for 70 companies, including group companies as well as its business outsourcing partners. Previously, ANA had used registered mail or high cost special delivery services to ship important documents with personal or confidential information; however, by switching interoffice mail over to company-owned vehicles, ANA was able to reduce costs by approximately 60 million yen annually. On top of this, ANA can now track the status of a parcel over the Internet, which has dramatically reduced the number of searches for lost parcels, the number of wrong deliveries as well as the number of inquiries received regarding delivery delays. The service also helped ANA cut its interoffice mail system labor costs.

"A company with business locations nationwide as well as many group companies and business outsourcing partners stands to gain significantly from using this service. This is why a number of different sectors are currently reviewing the implementation of our Interoffice Mail Trace Service," explains Maki.

Even companies that do not exchange mass quantities of important information through interoffice mail still tend to exchange important information with sales offices or customers. For these companies, YSD developed the e-Neko Security Box, an aluminum box that can only be unlocked using a registered mobile phone or IC card. YSD leases or sells these boxes to client companies. The e-Neko Security Box can be tracked using GPS, which enables a company to monitor over the Internet when, where and by whom the box was unlocked.

Managing the Life Cycle of Client Company Computers

Tatsufumi Sano
Division Head
PC Life Cycle Division

The PC Life Cycle Service is another recently launched proprietary solution that utilizes tracking technologies. In terms of accounting, computers are important corporate assets. Once the adoption of International Financial Reporting Standards (IFRS) takes place in Japan in the future, companies will need to manage their assets more thoroughly. In addition, an accurate account of the locations and usage of company computers is essential in considering the safeguarding of personal information.

"At present, some large corporations lack strict management controls of their computers. In many cases, information on company computers may not even be consolidated within a company, as often times a number of different divisions are involved such that purchase and procurement involves the purchasing division, budget management involves the accounting division, and equipment management involves the general affairs division, while help desk services and troubleshooting involves the information systems division. Using the PC Life Cycle Service, the entire history of a computer from its procurement to disposal can be tracked, enabling computer asset management to be fully outsourced. The only company that is capable of providing this one-stop solution is YSD," stresses PC Life Cycle Division Head Tatsufumi Sano.

Recently, computers are generally used for around four to five years. During this period, the user or location of the computer might change due to personnel transfers or organizational restructuring, which gives rise to maintenance needs such as a changeover in applications or repairs. If a company chooses to implement the PC Life Cycle Service, YSD's PC Life Cycle (PCLC) Service Center will take care of all steps from the moment of purchase, including kitting, which involves the initial set up and application installation, management services such as help desk services, asset management, repair, maintenance and security, as well as procedures after a computer is decommissioned including data erasure and disposal. In other words, this solution provides total support services throughout the life cycle of a computer in a manner where all process records are retained.

Starting in April 2011, PCLC-Web, a cloud-based system which allows the exchange of computer management information over the Internet, will be launched. After the system is installed, a company will be able to simply and centrally manage this information online. The system uses a two dimensional barcode to make registering where and by whom a computer is being used much easier. By having the user take a photograph and send the digital image of this barcode via a mobile phone, the system can identify a registered computer and its user. As such, using the PCLC-Web service makes the management of laptop computers or mobile equipment that much easier.

"Using the PC Life Cycle Service will reduce the work load of a company's information system department as well as its general affairs and accounting departments, thereby making it possible to significantly cut personnel expenses. In the case of one major manufacturer, the company was able to save 1.2 million yen a month on personnel expenses. As such a benefit is proportional to the scale of a target group serviced, I would recommend the service be used not only a single entity but by the entire corporate group," explains Sano.

Moreover, clients can choose to use only a part of the service depending on the size or need of their company. For example, one home delivery provider is currently outsourcing only kitting and installation in stores to YSD. The replacement of computers at a client's store locations can only be done outside of their business hours. The flexibility in scheduling services to be performed on a nationwide scale as well as the service's help desk has received strong reviews.

Making Double Assurance of Data Center Security

In a cloud-based service, important information is stored on YSD's server instead of on the user's computer. For this reason, YSD takes all possible measures to ensure the security of its data storage system.

For example, in terms of security, YSD has a data center that is fully compliant with Payment Card Industry Data Security Standard (PCI DSS), the most stringent international security standard used by the credit card industry. In addition, YSD has established data centers spanning east to west as a back-up structure as well as chosen to use seismically isolated buildings and install multiple independent back up power generators and communication routes in preparation for unforeseen disasters.

As announced in January 2011, the Yamato Group's long-term management plan to 2019 calls for the entire Group to aim to implement a total of 100 new businesses. So far, about 50 of these businesses have been implemented, while businesses led by YSD total 8.

Minaki shares his determination for the future: "To reach the goal of 100 businesses for the entire Group, YSD needs to at least double its current number. Since there are a number of e-money related leads that can potentially grow into large businesses, this is where I would like focus on for steady growth. Also, in conjunction with YSD's expansion in Asia, we plan to provide our ICT solutions currently available in Japan locally in the region. On a non-consolidated basis, our company alone aims to triple our current sales and quadruple our profits by 2019. To achieve this goal, we will continue to strive to develop useful solutions for all of our clients."

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About the Yamato Group

The Yamato Group includes the following companies: Yamato Transport Co., Ltd., which has developed an express delivery network nationwide; Yamato System Development Co., Ltd., which develops and operates diverse IT solutions including data centers; Yamato Home Convenience Co., Ltd., which transports and sets up consumer electronics, household goods, and machinery that cannot be transported via express delivery; Yamato Logistics Co., Ltd., which specializes in domestic and overseas logistics outsourcing; Yamato Financial Co., Ltd., which provides settlement services; and others. These companies pool their talents, which encompass "information, logistics, and settlement", to provide optimal solutions from a comprehensive perspective to the problems of client companies.